Polyacrylamide (PAAm) hydrogel is widely used in biomedical and soft robotics applications due to its better stability and biocompatibility. A comprehensive understanding of molecular-level structure/property interactions in hydrogels is essential for advancing the initiatives. Molecular dynamics (MD) simulations are carried out to investigate the effect of swelling on the mechanical properties of the PAAm hydrogel using ReaxFF potential. Hydrogel systems with 25, 50, and 75 wt% hydration were equilibrated using NVT and NPT ensembles before subjecting to uniaxial deformation. The diffusion coefficient of the PAAm hydrogel in 50 wt% water for 250 ps and in three-dimensional spatial dimensions was determined to be 8.1 × 10−5 cm2/s. Uniaxial tensile deformation at a strain rate of 109 s−1 was simulated by steadily displacing the face of the system aligned in the x-direction. The yield peaks for 25, 50, and 75 wt% hydrated PAAm hydrogel networks were recorded at 401.08 kPa, 353.15 kPa, and 98.73 kPa, respectively. The mechanical strength of the hydrogel diminishes as the system swells.